PPP models create incentives for corruption: Aam Aadmi Party

“We do the politics of people. They do the politics electricity companies. That is difference between our politics and their politics,” said Arvind Kejriwal, convenor of the Aam Admi Party (AAP) after kick-starting his political campaign in Delhi with an attack on Chief Minister Sheila Dikshit, on Friday.

Addressing the media, Kejriwal alleged that a nexus between the Congress-led government in Delhi and power distribution companies was responsible for the doubling of electricity prices during the last three years. Link here.

Arvind Kejriwal. Agencies.

Placing their ‘people politics’ in context, member of AAP’s national executive and senior lawyer Prashant Bhushan said: “After this privatisation of electricity distribution in Delhi and the creation of private monopolies in the guise of public private partnerships (PPPs)… this whole model is functioning in a manner where there are frauds, fabrications, forgeries at multiple levels which have the effect of cheating their consumers to the extent of half of the electricity bills they are paying.”

In the context of the effect privatization of power distribution companies in Delhi has had on consumers, Bhushan went on to question whether the PPP model was in public interest at all, “I think a more fundamental issue arises out of this whole thing: Is this model in public interest at all, where you have a private monopoly, a state-created private monopoly, which is supposedly regulated by a regulator. This model has created in-built incentives for corruption and this is what is happening. Consumers are being made to pay more and more because they have no choice,” Bhushan said.

Bringing up the arguments that had been made by the government in favour of privatization, Kejriwal said: “Distribution losses were very high prior to privatization. The government claimed that with privatization these losses would be reduced and when these gains would be passed on to the consumers, the electricity tariff would come down…since then the distribution losses have come down from 55 per cent to 15 per cent. Where did the gains go? Rather than being transferred to Delhi citizens, the entire gains have been cornered by the electricity companies.”

In a bid to expose what AAP called a ‘nexus between the government and power companies’, Kejriwal made public a letter by the Delhi government (dated May 4, 2010) directing the Delhi Electricity Regulatory Commission (DERC) to withhold its order reducing the power tariff. The Tariff Order for 2010-11, a copy of which was also released, drafted by Brijender Singh, then chairperson of the DERC, called for a reduction in the power tariff.

“Hours before the order was to be passed, Sheila Dikshit wrote a letter to Brijender Singh not to pass the order. What was Sheila Dikshit’s problem? Why did she stop the order?” asked Kejriwal.

Responding to Kejriwal’s claims, the Chief Minister’s office told PTI that the “allegation are a bundle of lies.” Also challenging Kejriwal’s claims, PTI quoted Power Minister Harun Yusuf as saying: “The allegations are totally baseless. The tariff order he was referring to was not signed by all the three members of the DERC. So you cannot call it a tariff order. Even Delhi High court had held that it was not a DERC order.”